Michigan Lawmakers Introduce Four Bills to Regulate Cryptocurrency Industry

Michigan lawmakers have introduced four new bills aimed at regulating the cryptocurrency industry within the state. These proposals come at a time when the broader regulatory landscape for digital assets is evolving, with various states and federal bodies grappling with how to best oversee this rapidly growing sector.

House Bill 4510, introduced by Rep. Bill Schuette, seeks to allow Michigan’s state treasurer to invest retirement funds in cryptocurrencies, specifically those with a market cap of at least $250 billion over the previous year and held through exchange-traded products. This move is aimed at providing regulatory oversight and ensuring that the investments are made through registered investment firms. The bill effectively narrows eligibility to Bitcoin, which has shown significant institutional interest.

House Bill 4511, introduced by Rep. Bryan Posthumus, takes a different approach by proposing a state-level ban on any licensing, taxation, or restriction of digital asset holdings. The bill also prohibits state agencies from advocating for a U.S. central bank digital currency (CBDC). This measure is a response to the federal government’s push for CBDCs and aims to protect digital asset holders from potential government interference.

Rep. Mike McFall introduced two companion bills, HB 4512 and HB 4513, focused on Bitcoin mining and tax reform. HB 4512 establishes a “Bitcoin Program,” allowing private firms to plug abandoned oil or gas wells in exchange for temporary rights to mine Bitcoin using residual fuel sources. HB 4513 offers income and corporate tax deductions for revenue earned through such mining efforts, linking crypto directly to environmental remediation. If passed, the program would be administered by the state’s Supervisor of Wells, who would maintain a public registry of eligible well sites, solicit annual bids, and ensure that participating miners carry financial responsibility for site restoration.

Michigan’s legislative push comes as several U.S. states are racing to either welcome or restrict crypto adoption. Just hours earlier, the Texas House passed a bill to create a state-managed Bitcoin reserve, sending it to Governor Greg Abbott’s desk. The bill would allow the state comptroller to invest in any digital asset with a market cap above $500 billion, currently only Bitcoin. Earlier this month, New Hampshire became the first state to formally authorize crypto and precious metal investments for public funds.

These four bills represent a comprehensive approach to regulating the cryptocurrency industry in Michigan. By addressing key areas such as regulatory clarity, taxation, consumer protection, and environmental sustainability, the state aims to create a supportive environment for the growth of the crypto industry while also protecting the interests of its citizens. The introduction of these bills is a significant development in the ongoing efforts to regulate the cryptocurrency sector and reflects the growing recognition of the importance of digital assets in the modern economy.